The case involves a dispute between Altay Football Club and the Professional Football League of Kazakhstan (PFLK) and the Football Federation of Kazakhstan (FFK) before the Court of Arbitration for Sport (CAS). The conflict arose when the PFLK deducted nine points from Altay FC’s record in the 2016 First League championship due to unpaid wages owed by FC Vostok, a predecessor club, to two former players. Altay FC, established in 2016, had replaced FC Vostok in the league through an assignment agreement that transferred membership rights but explicitly excluded financial obligations. FIFA had previously ruled against FC Vostok for non-payment of wages and instructed the FFK to impose sanctions, which were subsequently enforced against Altay FC by the PFLK.
Altay FC appealed the decision, arguing that the assignment agreement did not transfer FC Vostok’s liabilities, including unpaid wages, to them. The CAS panel examined whether the PFLK’s decision was legally binding, whether the FFK and PFLK were proper respondents, and whether the sanction could rightfully be imposed on Altay FC. The panel concluded that the PFLK’s decision was legally binding as it expressed intent to produce legal effects and was communicated to Altay FC. It also ruled that the PFLK was a correct respondent.
Regarding the assignment agreement, the panel found that it only transferred membership rights and did not extend to unfulfilled financial obligations, such as unpaid wages. Therefore, the sanction of point deductions, imposed due to FC Vostok’s non-compliance with FIFA’s rulings, could not be transferred to Altay FC. The proceedings followed standard CAS arbitration procedures, including written submissions and a hearing in Lausanne, where only Altay FC was represented. The panel ultimately ruled in favor of Altay FC, holding that the points deduction was unjustified as the club had not assumed FC Vostok’s financial liabilities.
The Respondents argued that Altay FC had confirmed its succession from FC Vostok through the assignment agreement and was thus liable for the latter’s obligations, including FIFA-mandated sanctions. However, the panel found no evidence in the agreement or related documents indicating that Altay FC had taken on FC Vostok’s financial debts. The FIFA DRC decisions also specifically targeted FC Vostok, not Altay FC. The panel emphasized the necessity of clear contractual terms and evidence when determining liability in sports disputes.
The CAS ruled in favor of Altay FC, upholding the appeal, setting aside the challenged decision, and annulling the point deduction. The nine points were reinstated to Altay FC, and all other relief requests were dismissed. The decision underscores the importance of due diligence in club succession agreements and adherence to sporting regulations, reaffirming that sanctions must be based on actual legal responsibility. The award was issued on 23 January 2017, with the operative part dated 24 October 2016.